City of Chicago Denies Permit for General Iron Scrapyard on Southeast Side

Mayor Lori Lightfoot last year delayed the decision on whether to issue a permit following a suggestion from a top U.S. environmental official

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The Chicago Department of Public Health on Friday denied a permit application for a scrap metal facility that sought to operate on the city's Southeast Side, bringing welcome news to residents who for years fought against the proposal.

In a news release, CDPH announced it determined "potential adverse changes in air quality and quality  of life that would be caused by operations, and health vulnerabilities in the surrounding communities - together with the company's track record in operating similar facilities within this campus - present an unacceptable risk."

The announcement comes after an eight-month Health Impact Assessment recommended by the U.S. Environmental Protection Agency. The assessment found certain census block groups rank among the highest in Chicago for vulnerability to air pollution, and the proposed facility would contribute additional negative impacts to the environment, health and quality of life.

Furthermore, according to CDPH, during the review, officials discovered apparent instances of non-compliance with city health and environmental regulations and requirements on behalf of the operator, Reserve Management Group, including the failure to obtain necessary permits for foundry sand operations.

The Natural Resources Defense Council, which had long pushed against the facility's relocation from Lincoln Park to the Southeast Side, called the denial an "enormous victory," but said the city must be dedicated to policies that prevent such a situation from happening.

"Our community is not a sacrifice zone," the NRDC and other environmental organizations said in a statement, in part. "...Although we are celebrating this decision, the community continues to deal with the toxic legacy that has allowed pollution to accumulate in our community and we will not stop fighting for our right to clean air, and we will continue to fight until the health of Chicago communities like ours can live in a healthy environment.”

In May of last year, Chicago Mayor Lori Lightfoot delayed a decision on whether to issue the permit following a suggestion from a top U.S. environmental official to conduct the HIA before a decision was made.

Reserve Management Group closed its General Iron car-shredding facility in the predominantly white and affluent Lincoln Park neighborhood in 2020. The company later announced plans to open a new facility, Southside Recycling, in a predominantly Latino community near the Illinois/Indiana border.

In July of 2021,RMG filed a lawsuit against the city of Chicago, aiming to force the city to issue a final permit, in addition to seeking more than $100 million in damages due to the delay. A federal judge tossed out a similar lawsuit a month earlier.

The company claimed it followed every step of the two-year permitting process, building the “most environmentally conscious recycling facility in the country,” but that the city didn't abide by an agreement it entered with the company in 2019.

Community opposition to the new shredding facility was strong, with residents calling the move a case of environmental racism.

In a statement issued after the denial was announced Friday, RMG said, in part, "politics, not environmental or public health protection, is the only reason that the city denied Southside Recycling’s permit to operate."

The full statement from RMG is provided below:

“We have built the most environmentally conscious metal recycling facility in the country, but politicians and government officials have ignored the facts and instead were cowed by persistent false narratives and misinformation aimed at demonizing our business. What should have been an apolitical permitting process was hijacked by a small but vocal opposition that long ago made clear they would unconditionally oppose this facility, facts and science be damned. Politics, not environmental or public health protection, is the only reason that the city denied Southside Recycling’s permit to operate.

Experts repeatedly determined that Southside Recycling would not threaten public health or environmental justice efforts. When the Illinois EPA completed its exhaustive review process and issued our state air permit in June 2020, its efforts were lauded by career professionals at the U.S. EPA for taking a rigorous approach to community engagement and environmental justice considerations. And the City’s own health experts, using intentionally inflated parameters to overstate the effects of the operation, still concluded that the facility poses no risk of adverse health effects above the benchmarks defined by the U.S. EPA.

We will continue to pursue all avenues to challenge this decision, including pressing our lawsuit against the city, which will likely result in taxpayers being on the hook for hundreds of millions of dollars in damages. Aside from the litigation, this decision is a clear message to any businesses or industries that might be considering expansion or investment in Chicago: the city is not a reliable partner and is not open for business. Chicago has loudly stated that politics – not signed agreements, its own laws and regulations, nor actual protection of human health and the environment – is the ultimate consideration in all matters.”

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